On duty, I interviewed a person who has been doing market research, software development trends and IT services in Central and Eastern Europe for many years, 15 of them in Russia. And although the most interesting, in my opinion, the interlocutor left behind the scenes, nevertheless, this story can be both curious and inspiring. See for yourself.
Eugene, hello, to begin with, tell me how to pronounce your name correctly?
In Romanian - Eugen Schwab-Cesaru, in English - Eugene, in Russian - Evgeny, in Moscow, in Russia, everyone knows me as Evgeny from PAC.
You have worked a lot with Russia. Could you talk about your experience?
I started working for PAC over 20 years ago. Conducted market research for strategic consulting services dedicated to the software and IT services industry in Central and Eastern Europe. Key countries of this region: Russia, Poland, Czech Republic, Slovakia, Hungary, Turkey and Romania, we also worked a lot with the markets of Ukraine, Bulgaria, Serbia. Our office in Romania deals specifically with Central and Eastern Europe, and I have been managing this office for over 20 years.
We started working with Russia 15 years ago, when we held 20-30 meetings in Moscow, and several in St. Petersburg. Since then, we have kept in touch with Russian players in the field of software and IT services, especially among large and medium-sized companies. We have also contacted many offshore IT companies, some of them from Russia and some of them very famous in Europe, USA and all over the world.
What is the essence of your work, what do you do?
We are in the middle of what is needed for the strategic marketing of IT companies. These are market research, market analysis, competitive analysis, up to forecast and strategic recommendations for companies involved in software and IT services. This is the core of our business, what our company has been doing for 45 years in Europe and around the world.
Over the past 10-15 years, we have worked a lot with users - both from companies and from investors. This applies to software and IT services markets, directions and players. For example, CIOs are asked to provide them with a picture, our understanding, as well as forecasts about the development of various technologies in different markets, about the positioning of different companies in specific areas, technology directions, or in a particular business.
For investors, things have accelerated over the past five, six, seven years, which is why many private equity funds, fin. institutions come to us asking for advice on the best areas to invest. Or, when they already have a target for an acquisition or a project, they ask for our opinion, which is really an analysis of the business plan of that business in the context of the market. Based on our understanding from the western side of the world and from the eastern side, we can support them in making the right decisions for future investments and evaluate the return on investment for the companies they are part of, as well as the value of the company they are targeting.
This is a specific approach, but ultimately it comes down to market knowledge, trends in terms of technologies and types of services, analysis of supply and demand. Therefore, we believe that in Western and Eastern Europe there are three coordinates at each point:
- Code, software product or IT service;
- Vertical, for example, banking or manufacturing or public sector, etc.;
- Geographic coordinate, such as a region or a country, or a group of countries.
To be able to provide all this, we are in constant contact with IT companies and IT decision makers. We are conducting an extensive survey with several partners, especially in Western Europe, the US and worldwide, but also in Eastern Europe (to a lesser extent - due to the size you can imagine).
We conduct this survey every year because we want to make the most of the current state of strategy and IT budget development and user-side behavior. We ask in detail, especially on hot topics: cybersecurity, digital customer experience, cloud computing, Internet of Things, business application services combined with cloud platforms, cloud migration, etc.
On all of these topics, we are getting very valuable input from decision makers regarding their intentions, plans, budgets, and the phase they are in with a project they started a few years ago.
This is also part of what we do. And another component that is unique, especially for Western Europe, for Germany and the UK, is our database of tariffs, prices. Every year we monitor changes in tariffs in companies, especially in Western Europe, I mean large and medium-sized companies headquartered in Western Europe, which are willing to pay for many types of services under various types of agreements, so we have databases with tariffs, some of which we offer through our research program.
I said that the database is unique because there is no similar analysis in the market, with three components: deep analysis on the supplier side, surveys on the user side, and a rate database in which we actually have both local rates and offshore rates, for example, from India (and we analyze both sides separately, because it is not logical to calculate the average value between them: the cases of their application are different).
We adhere to a holistic view of the software and IT services industry, this is what we offer in Eastern Europe and are trying to do in Russia.
I know that in November in St. Petersburg you will make a presentation "Trends and Opportunities in the Global Software and IT Services Industry". What will the report be about? Will you share your research?
Yes, we are going to share the latest result of our survey and our findings: what are the most important areas for development in the software development and IT services industry. We have a long list of 20-30 topics in the survey that we propose during interviews with IT decision makers, and in the end we get 10-15 areas that are the first in the list and are mentioned more often. On these topics, we will delve into the details.
We would also like to share how we see Russian companies that want to be successful all over the world, what we consider the right strategy, the right approach in the Western world. I would like to highlight a key difference between domestic buying behavior in Russia, buying behavior in Eastern Europe in general, and the most important buying behavior in the Western world. The segregation is quite high and it is very important not to waste time and money, to understand these differences from the very beginning and to approach services and markets correctly depending on their maturity, on their, let's say, plans, in terms of investments. I hope I can show it.
I can talk about this topic for hours, but I will try to give the most valuable in half an hour, and then discuss with those who show interest.
When you work, communicate with people from Russia, is it different from communication with people from other countries?
The people I met are middle and senior managers. They are well versed in what is happening in the world. At the same time, when comparing Russian IT executives with similar executives from, for example, Poland, the Czech Republic or Romania, I feel that Russian executives are proud to be from Russia and that their local market is potentially full of opportunities.
But if they decide to enter the international market, they plan to expand quite widely. If, for example, you are talking to someone from Poland, with a company that operates on the Polish market, and wants to succeed in Germany, the UK, Belgium or the Netherlands as well, they will talk about small steps, about making something then try it first.
And if you have the same conversation with a Russian leader, he is sure of his success in major transactions, even directly with major players in Western Europe. They are used to dealing with large organizations. It's very powerful, I think it's a very important condition for success, because everything is happening very, very fast in the IT industry today. And if you have planned small steps to enter the foreign market, at the end of the day you will be surprised, because when you “ripe” in three years, the conditions will be different from when you started the strategic plan.
So I think it's good to make a decision quickly, to take risks, and I feel that Russian companies, at least most of the companies that I have met in Russia, have this attitude, and if they want to expand abroad, they are quite straightforward and want to go pretty fast.
On the other hand, I have met quite a few Russian company executives who say that they do not need to expand abroad, that the Russian market is enough for them, that there is a lot of work in Russia, and I completely agree with them. The Russian market is full of opportunities, full of people, and this is just the beginning of IT development if we compare the GDP with the total income from all companies in Russia. Therefore, I fully understand companies that focus on the domestic market and do not waste time and energy looking abroad. There are different options, different business plans, and many paths can be successful.
But taking into account the competitiveness, the very good reputation of technical specialists from Russia, the success stories in the IT field of a number of companies, projects and individuals who come from Russia, it would be a pity not to use these resources for global projects, from which Russian companies can also learn a lot. : business processes, methodologies and experience that they simply cannot get in the domestic market yet.
Such a combination is beneficial, but we never say that we have a single correct strategy, that we have come up with a template and give it as an ideal solution. No, everything is individual in each case, and any business goal, strategic goal can be good if it is executed correctly, and if it is correctly set in the context of the market, supply and demand.
And, of course, the most important component today is human resources, the right skills. I see an industry that drives the industry and the market as a whole, and I firmly believe that Russian companies can be much more visible in Western Europe. In general, when I think that about half a million IT engineers are missing in Western Europe today, and if we count all the projects that were not completed due to lack of resources, if I look at the rate of price growth and the huge digital transformation plans of almost all organizations in Europe, USA, I can say that there is no limit for companies that really have the right technology and the right skills, and are serious about implementing projects in areas where demand is high today.
Thank you for taking the time to have this conversation, what would you like to wish our listeners?
I hope that you will have many ideas, and many answers to questions, and - why not - even more willingness to develop, invest and believe in the future of the entire IT industry in Russia and around the world.
Questions were asked by: Yulia Kryuchkova.
Interview date: September 9, 2019.
NB This is an abbreviated translation of the interview, .
Source: habr.com